CNSI objects to disqualification for Arkansas Medicaid contract because of Louisiana investigation

The head of a Maryland company disqualified from bidding on a Medicaid contract in Arkansas complained Monday that the state relied too much on the knowledge that Louisiana had terminated a similar contract and didn't take into account the firm's performance in other states.

Officials with Client Network Services Inc., or CNSI, told a legislative hearing they believed the company was unfairly disqualified from bidding for the state's Medicaid Management Information Systems contract.

State finance officials in July told the firm it was considered a "non-responsible" vendor and would not be considered for the claims processing contract.

"We believe that removal of CNSI from the competitive pool of bidders is not in the best interest of the state of Arkansas or its Medicaid beneficiaries because CNSI's solution offers the most technically advanced flexible and scalable MMIS solution available in the industry," Adnan Ahmed, the company's co-founder and president, told the Legislative Council's Hospital and Medicaid Study Subcommittee.

State finance officials said the firm was disqualified after they learned Louisiana had terminated a similar $200 million contract with the firm. Louisiana scrapped a 10-year Medicaid claims processing contract with CNSI on March 21 after details emerged about a federal subpoena seeking information about the contract award. The Louisana attorney general's office empaneled its own grand jury in May to look into possible criminal activity.

DFA Director Richard Weiss said he believed state procurement officials correctly followed procedure and noted that bidders' references were evaluated on a "pass/fail" basis. Weiss said the state is reviewing the remaining bids from three other firms.